It's been just a little over a year since we had our first major buy signal for the S&P 500 at 888.70 on 5/4/09. Since that time, the S&P 500 has climbed approximately 61.8% from the lows that were seen in early March of '09 and the highs that were seen in October of '07.
We take our "Trade Triangle" technology very seriously and this signal today (5/25) at 1044.50 is our first major sell signal since 7/1/08 at 1,272.00 and should not be ignored.
There are a whole host of problems that are coming due around the world that will have negative consequences for the equity markets. The problems in Greece and Europe are well known and are likely to continue for the balance of the year. This is going to have a negative impact on markets in general.
In my new short video I show you exactly what I think is going to happen to the S&P 500 market and just how you can protect yourself if we are correct. As always our "Trade Triangles" will dictate all market action. At the present time all of our "Trade Triangles" are negative and pointing to the downside. This indicates that a very strong trend is in place and it likely to continue.
Many traders, especially younger traders, are unaware of how bear markets work. Bear markets tend to be demoralizing as they do not have any strong and sustained rallies. They tend to erode as more and more traders become unnerved and throw in the towel.
I invite you to take a look at this new video with no registration and no charge.
Whether you agree, disagree, or just want to comment on this video, please comment below.
All the best,
7 thoughts on “One year later, reality sets in”
today, more bad news for the Bears:
BIGGEST 2-DAY DROP SINCE MARCH 09
a close below the 8-FEB closing low of 1056.74
it appears the Right Shoulder has been formed,
if/when the 5-Feb/25-May Neckline is taken out,
the Down Side Target would be the 880-940 range of the May-July 2009 Head & Shoulders.
thanks for the video. I went short after this video and feel very nervous because it seems the market is going to have a hard rally. I thought that the monthly sell signal was reliable. My question to you sir is that is it possible a monthly signal could be a headfake and the signal turns into a buy signal shortly after?
Thank you for your feedback.
I just got back from France and I can see that the market has rallied. The rally however has not turned our long-term monthly trade triangle into a positive position, in fact the trend remains negative based on our technical work.
All the best,
If you look back 5 years, you can see that even the 1-year uptrend in 2009 was part of a longer bear market.
The decision now becomes, "Are you an investor or a trader?" The market will go sideways for a few days here and then probably go up fairly substantially...but not as high as the last time...and when it corrects, it will do so lower than it did this time.
I am buying right now because I'm a trader, but you should stay out if you're an investor. Also, I would not go short just yet...wait for 5 or 6 weeks when things top out.
Just my opinion!
A Nison Hammer occurred on Feb 5 where the support is the hammer low of 1044.50. The SPX trended higher after that hammer.
On May 25, the intra-day low fell below the Feb 5 low but closed above that low...so support was not broken. Also another Nison Hammer was formed on May 25 with new support at that hammer's low of 1040.78.
It should go to 1106 to 1122 before consolidating or going south again.
We shall see how powerful this second Nison hammer is in light of the market seasonality to go down or chop during the summer months.
I believe this corrective will stop around S&P 1115 before the next wave down starts.
I think S&P will make a correction upto 1125
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